Strategic Management: External Analysis (Toyota)



Strategic Management: External Analysis (Toyota)

Company Background

Toyota Corporation is a gigantic Japanese automaker. It is a multinational corporation and is one of the top companies in the automobile industry in the world. The management philosophy of the Company has evolved from the company's origins and is reflected through the terms 'Just In Time Production' and 'Lean Manufacturing', in which it has been actively involved (Yasuhiro, 1998). The philosophy of the Company mainly has four components:

Important decisions of management are based on long-term thinking,

Value is added through training and development of its employees,

A systematic approach for solving problems, and

Organizational learning is driven through efforts to continuously solving the root problems.

Major Competitors

The main competitors of Toyota Motors are Ford Motor, General Motors Corporation and Honda Motors Co. Ltd. Ford Motors deals with different types of cars and trucks at the global level.

External Analysis

In order to stay active and competitive, an organization must take into account not only internal processes but also look into account the external environment (Nag, 2007).Opportunities

Toyota Motors has a good reputation in the market for its image of making environmental friendly cars.

The company launches new models continuously to capture urban youth market at a large scale.

The company has extra money incurred from currency shifts, which it uses to improve its research and development.

The company initiates to launch new products which will generate customer interest.

Threats

The company faces the problem of product recalling.

Toyota Motors faces terrible competitive rivalry in its market.

Toyota Motors has threats from the increasing competition due to new entrants.

The company also has the problem of continuously increasing prices of raw materials like steel, fuel, rubber.

Actions to environmental contingencies

Since the oil price is expensive nowadays, Toyota produces a car (hybrid and fuel saver) which can contribute to society and do not harm to the environment. Besides that, Toyota Auto recycling also can create the job opportunity for unemployed. In addition, Toyota has also sold on its technology to other motor manufacturers such as Ford has bought into the technology for its new Explorer SUV Hybrid (Jeffrey, 2003). Toyota became the mover of the auto maker industry by introducing the hybrid systems. The brand was not that pretty but was the first of its kind in terms of technology; this quality attracted customers and held the focus of the customers on Prius. Toyota uses the measurements to enhance quality planning through understanding the changes in customer demands, analyzing the consistency with organizational standards, and the ability to adjust processes quickly to amend any disagreements.

To overcome these threats Toyota is striving their sales volume by meeting demand in resource-rich and emerging countries like in Europe; they are penetrating a highly competitive Market with the strong product line-up. Toyota is striving to keep pace with the rapid expansion of the business and technological changes, these pressures are exerted by: meet demand, expand the ambitions and the increasing rate of technological change (Cusumano, 2008). They are increasing their presence in Asian markets that are rapidly growing in importance as stable ...